Speaker 1: Ye, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane
Speaker 1: jay Ley. We bring you insight from the best in economics, finance, investment,
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Speaker 1: consider the market moves. The moves continue this morning with
Speaker 1: tweet Line Noyan of Commerce Bank and Daniel Morris of
Speaker 1: course of BNP Perry by joining us as well tweet
Speaker 1: what will this do to the dollar? Do you have
Speaker 1: to reset at Commerce Bank your dollar call off what
Speaker 1: Chairman Paul said? Uh No, Actually, in fact we feel
Speaker 1: confirmed in our dollar of you. We have been expecting
Speaker 1: a weekending dollar UM next year, particularly as the fat
Speaker 1: hiking cycle will draw to an end and markets concentrate
Speaker 1: on that and UM. This is a common pattern that
Speaker 1: we've seen in the past with past rate hike pikers.
Speaker 1: As the andraws near, the dollar doesn't benefit from from
Speaker 1: the last couple of rate hips anymore, as the market
Speaker 1: is already foreseeing UM the peak of interest rates, and
Speaker 1: actually UM the dollar starts to weaken UM. So, in
Speaker 1: fact Powell has confirmed our view in that very good
Speaker 1: Dan Morris, let us look at John Authors, who channels
Speaker 1: Jeremy grandson of GMO here on the old Bronosurus Cbranosaurus model.
Speaker 1: They served rannosaurs at lunch yesterday as well as wonderful
Speaker 1: Chairman Powell wants more room for discretion. The stock market
Speaker 1: to a bronosaurs, Well, it took a long time for
Speaker 1: information to go from the brono sours his head to
Speaker 1: its tail. In the same way, the bond market is
Speaker 1: the bronosaurs his head, and the stock market just simply
Speaker 1: gets the news. Last, Dan Morris, I mean we see
Speaker 1: again the communication here of any given central banker, the
Speaker 1: bond market picks up with it. Do you have to
Speaker 1: reset your bond framework off what the chairman said? Actually
Speaker 1: not at all, And if anything, we're a bit concerned
Speaker 1: that the market is over interpreting his comments. I think
Speaker 1: if we step back and look at the outlook for
Speaker 1: inflation for next year, the strength of the economy, the
Speaker 1: level of unemployment and so on, that still suggests three
Speaker 1: hikes is appropriate in our view for next year. So
Speaker 1: we may have a pause, be that a March or
Speaker 1: b then in June, and that is on the margin
Speaker 1: a change from what we had thought previously. But fundamentally
Speaker 1: we think you are going to see how interest rates
Speaker 1: of FED is not going to stop raising rates December,
Speaker 1: isn't it. There's going to be more than one next year,
Speaker 1: And for now the market is ignoring all of that.
Speaker 1: We've obviously got the big rally, but eventually the realization
Speaker 1: is going to set back in about her interest rates
Speaker 1: and then there's a risk, of course, at all of
Speaker 1: these reverses. So Dan, where do you want to be
Speaker 1: invested right now? Take advantage of that well, and we
Speaker 1: are in were neutral and equities overall in our multass
Speaker 1: of portfolio, but we're still underweight fixed income. So you
Speaker 1: can't particularly enthusiastic about equity at the point, but on
Speaker 1: a relative basis, we think they should outperform. So that's
Speaker 1: kind of our position at this point. Then let me
Speaker 1: kick off with you. When you look at brexit, is
Speaker 1: it doomsday scenario if we don't have a deal, Does
Speaker 1: it now make it more likely that we do get
Speaker 1: the deal? Improvement in Parliament? We think of a range
Speaker 1: of options. We have a plethora surfeit of alternatives. I
Speaker 1: think at this point of how it can play out,
Speaker 1: I think the forecast that we've seen is kind of
Speaker 1: the worst case assumption, which is you end up not
Speaker 1: only with no deal in the crashing out, but no
Speaker 1: kind of mitigating efforts between now and then to ANNAILU. Right,
Speaker 1: what could be the effects at that point? So you know,
Speaker 1: if that's our worst case, uh, and then we go
Speaker 1: from there towards you know, a remain where nothing really changes,
Speaker 1: so we kind of know what the outlook isn't there.
Speaker 1: But across that there are, like I said, several options
Speaker 1: with different economic effects, and the probabilities of those not
Speaker 1: only are shifting, but there's no one really that stands
Speaker 1: out as highly probable um to land. And what is
Speaker 1: being priced into your brexit or you're actually your pound
Speaker 1: forek offs right now it comes to brexit. UM. I
Speaker 1: mean we've seen that the options market has become relatively nervous. UM.
Speaker 1: You've seen implied volatility is picking up. UM. So the
Speaker 1: market is pricing in or husband pricing in the higher
Speaker 1: probability of a no deal. But the levels are still
Speaker 1: nowhere near um that we saw around the two thousands
Speaker 1: sixteen referendum. So all in all, the market still seems
Speaker 1: relatively relaxed when it comes to a no deal scenario,
Speaker 1: UM and UM. I think that is due to the
Speaker 1: fact that m as just heard, there are so many
Speaker 1: scenarios how this Brexit could play out, what could happen
Speaker 1: after this vote in the British Parliament. UM. There are
Speaker 1: also some scenarios which could play out quite positively for
Speaker 1: the pound. I mean, people are talking about the second referendum,
Speaker 1: which could in the end lead to UM the UK
Speaker 1: remaining in the EU event, which would be positive for
Speaker 1: the pound. UM. So it's very difficult to make a
Speaker 1: pound forecast at this moment with all scenarios, I mean,
Speaker 1: a nicely laid out what are we gonna do? What?
Speaker 1: What do you do? Where? Where is the opportunity on
Speaker 1: pound sterling? UM? I think from a risk return perspective,
Speaker 1: I still think investors with pound exposure UM should take
Speaker 1: the opportunity to hedge their risks in in in their
Speaker 1: long positions, because, as I said, UM, yes, volatilities have
Speaker 1: picked up, but they're still relatively cheap. Because in a
Speaker 1: in a nodeal scenario, I would expect the pound to
Speaker 1: depreciate at least by ten per center even more, UM
Speaker 1: and UM. The market is not yet prepared for that
Speaker 1: so at this moment um, your uh buying implied volatility
Speaker 1: is actually a good risk return investment. All right, thank
Speaker 1: you boys for joining us to Land and there of
Speaker 1: Commerce Bank and done mores of BNP Paraba. We begin
Speaker 1: with a man who served as deep Incident of the
Speaker 1: European Central Bank from two thousand three until two thousand
Speaker 1: and eleven, living through not one but two crises in
Speaker 1: the euro Zone. From Leland, France. It is Jean Claude,
Speaker 1: free Shack and it joins us now. Jean Claude is
Speaker 1: great to catch up with you pleasure to be here.
Speaker 1: Talk to me about how difficult it is to stand
Speaker 1: somewhere like the Economic Club of New York with a
Speaker 1: load of pressure on you to say the right thing.
Speaker 1: How difficult is there? I think it that it is.
Speaker 1: It is quite a challenge, of course. I think that
Speaker 1: Chairman Powell did extremely well, and he probably corrected what
Speaker 1: had been an overinterpretation of his previous message on the
Speaker 1: long Way from Newt Hall in mentioning that it was
Speaker 1: closer from to a Newt Hall than before. I would
Speaker 1: say we have to be aware of both over interpretation.
Speaker 1: But it seems to me that he corrected quite well
Speaker 1: that what might have been an over into put Ducian
Speaker 1: before and now we end up with perhaps another over
Speaker 1: interpretation because just going through the quow at the moment,
Speaker 1: Joan Flatricia reads as follows, interest rates are still accommodative,
Speaker 1: but we're gradually moving to a place where there'll be neutral,
Speaker 1: not restraining growth. We may go past neutral, but we're
Speaker 1: a long way from neutral at this point. Probably that's
Speaker 1: October three, here's novembery. Interest rates are still low by
Speaker 1: historical standards, and they remain just below the broad range
Speaker 1: of estimates at the level that would be neutral for
Speaker 1: the economy now October three to judgment November twenty eight,
Speaker 1: the statement of fact, I mean, we know what the
Speaker 1: broad range of neutralists. It's two fifty to three fifty,
Speaker 1: and as a matter of fact, we are just below that.
Speaker 1: So I'm not sure he actually made a judgment yesterday.
Speaker 1: Did he's just standing a matter of fact. I think
Speaker 1: that you're right. I think that it was a matter
Speaker 1: of fact, and that he did not intended to over
Speaker 1: I would say communicate to the market that there was
Speaker 1: a change in the perception on the one hand, and
Speaker 1: in the in the likely decision of the Open Market Committee,
Speaker 1: so I would very much agree with you. That being said,
Speaker 1: it was very well done in my opinion, and of
Speaker 1: course what counts is what you do, not only what
Speaker 1: you are pre announcing of any overinterpretation of words, and
Speaker 1: we will see what happens. I have full confidence in
Speaker 1: the Open Market Committee to continue to do what is
Speaker 1: needed in the present circumstances where obviously we have the
Speaker 1: two targets of the of the Central Bank are very attained,
Speaker 1: if I may, in terms of employment full employment and
Speaker 1: in terms of overall solid anchoring of infession expectations in
Speaker 1: line close to be in line with the definition of
Speaker 1: price stability, which by the way, is the same in
Speaker 1: all four major central banks that are issuing the currency
Speaker 1: that are in the s d R apart from the
Speaker 1: Renman b you know, the four others are the Sterling,
Speaker 1: the end, the yar, and the dollar, and all centle
Speaker 1: banks have the same definition two or close to two percent.
Speaker 1: That's very important. It's a byproduct of the crisis, in
Speaker 1: my opinion, solidly anchoring inflation expectations at a level which
Speaker 1: would be understood by everybody. So we're at this delicate
Speaker 1: part of the cycle for the United States and for
Speaker 1: the federal serve as well. He's not just trying to
Speaker 1: weigh what happens with the labor market and potentially with
Speaker 1: inflation as well, he's also trying to weigh financial stability concerns.
Speaker 1: And Jean Quatricia, you know, as well as anyone listening
Speaker 1: to jerm Powell over the last year or so, again
Speaker 1: and again and again, he states that the last downturns,
Speaker 1: the last few downturns over the last few decades, have
Speaker 1: been caused not by inflation overshoots, but by financial instability
Speaker 1: and financial crisis. How do you set monetary policy to
Speaker 1: account for that and anchor inflation expectations too. No, that
Speaker 1: that's a very very important point. There is absolutely no
Speaker 1: doubt that. Also one of the consequence of the crazies
Speaker 1: was to put the central banks, as I would say,
Speaker 1: very close to the financial stability mandate, without changing necessarily
Speaker 1: the mandate, but putting the center bank very close. And
Speaker 1: I have been the witness myself or the setting up
Speaker 1: of the Financial Stability Oversight Council on in the US
Speaker 1: of the European Systemic Risk Board, which I was the
Speaker 1: first chairman of. As a consequence of the crisis and
Speaker 1: that that is very very important. And I take it
Speaker 1: that what what Chairman Powells said on what they were doing,
Speaker 1: encouraging resilience in the financial system, monitoring financial instability and
Speaker 1: being transparent, and he was very transparent. Obviously, I think
Speaker 1: it was it was certainly part of the responsibility of
Speaker 1: the of the center bank. Do we have too much
Speaker 1: forward guidance now? Do we have enough? Or do we
Speaker 1: have to ebb it back as clearly Mr Powell is stating,
Speaker 1: and I would suggest you agree with to the engineering
Speaker 1: mark some which is data dependency. Well, first of all,
Speaker 1: the various central banks are not exactly in the same situation.
Speaker 1: As you know. The US FED is much in advance
Speaker 1: on Europe, not surprisingly because Europe in the business cycle
Speaker 1: had a lag visavi the US because of the sovereign
Speaker 1: risk crisis. So there is a difference. So I take
Speaker 1: it that the forward guidance in Europe is absolutely necessary
Speaker 1: because we are in the citucation realm and market participants
Speaker 1: have to know what will happen. In the US, clearly
Speaker 1: we are less close to absolute necessity forward guidance, and
Speaker 1: it seems to me that you can understand what said,
Speaker 1: were the two questions here? One of them is really important.
Speaker 1: Let me go with the weaker one. First, the news
Speaker 1: flaws extraordinary with Deutsche Bank, un a credit the financial
Speaker 1: system of Europe. John, and I every day of a
Speaker 1: mystery over the chronic nature of negative interest rates. You
Speaker 1: didn't study negative interest rates as a kid, and yet
Speaker 1: bankers are living with it each and every day, particularly
Speaker 1: in Germany. Now that's true. How does this how do
Speaker 1: you perceive this ending? Well, first of all, I take
Speaker 1: it that it was necessary at time, and as you know,
Speaker 1: it will still be there until probably the last quarter
Speaker 1: or the end of the third quarter of next year. Uh.
Speaker 1: At the very beginning, the trust was those negative rates
Speaker 1: will have devastating consequences on all the funcial sphere, and
Speaker 1: particularly on the banks. I would say the judgment is
Speaker 1: much more nuanced now because we saw how banks, some
Speaker 1: of them, the best managed banks, could cope with it.
Speaker 1: So I would say it's it was very very non conventional,
Speaker 1: obviously probably necessary. And what about now and what about
Speaker 1: in two thousand twenty? How do you get off, as
Speaker 1: you correctly stated in a panel, the ax of Weber,
Speaker 1: the addiction of all this. No, it's clear that we
Speaker 1: have to get progressively I would say, serenely out of
Speaker 1: a situation which is totally non conventional, and we are
Speaker 1: starting to do that, as you know, because because the
Speaker 1: the end of tapering is for the end of this year.
Speaker 1: In Europe again we have lags in comparison with the
Speaker 1: United States of America. But the course, the course is
Speaker 1: more or less the same sequence. But Jean Claude, there
Speaker 1: is a big question that I think we have to
Speaker 1: start exploring the prospect that we're stuck here, that we
Speaker 1: don't get away from zero in the euro Zone because
Speaker 1: the cycle doesn't last long enough for them to do it.
Speaker 1: You're starting to think about that, Yes, yes, of course,
Speaker 1: as I already said, of course it's very very important
Speaker 1: that we are real feeling the overall weaponry of I
Speaker 1: would say, not on the central banks, but also the
Speaker 1: governments and all kinds of of tools that can be
Speaker 1: utilized when we have to cope with the next recession.
Speaker 1: The main problem for the European would be that when
Speaker 1: the US, which is ahead in the cycle, has its
Speaker 1: recession by contagion, we might have a big, big problems
Speaker 1: for us. Even if it would not be appropriate in
Speaker 1: terms of business cycle in Europe. So we will see.
Speaker 1: But again I take it that what is being done
Speaker 1: right now is correct. That we have in mind that
Speaker 1: you have several weaponry that we are non conventional, the
Speaker 1: interest rates of course, and also the quei or so
Speaker 1: called quei, and we have to do that, namely normalize
Speaker 1: progressively and as I said, serially, if we do not
Speaker 1: want to have counter productive effect. But I take it
Speaker 1: that all santle bankers in the world are fully aware
Speaker 1: of the fact that the main, main, major issue for
Speaker 1: them would be the next slow down of the circle.
Speaker 1: For anyone just joining us on Bloomberg Radio, Jean claud
Speaker 1: Trichet joining Bloomberg Surveyments this morning, the former European Central
Speaker 1: Bank President Jean Claude talking about the next cycle. I
Speaker 1: think what is really interesting when you were at the ECB,
Speaker 1: the periphery started trading like credit. Sovereign debt in Italy
Speaker 1: in Spain has all the characteristics of a credit and
Speaker 1: not a sovereign. That's still the case. So let's explore
Speaker 1: this further. We go into the next downturn and Italy
Speaker 1: still trades like credit. How much of an issue is
Speaker 1: that going to be? Well? Again, Italy today is more
Speaker 1: or less a paradox. On the one hand, they have,
Speaker 1: of course a lot of liabilities, including one percent of
Speaker 1: the GDP in terms of of I would say state
Speaker 1: over outstanding debt, so that that's big. On the other hand,
Speaker 1: they have a card account surplus which is not negligible.
Speaker 1: They have a primary surplus in their budget, which is
Speaker 1: something so and the appropriate in the circumstances, but which
Speaker 1: is there, and you know that they have because they
Speaker 1: have a current account which is behaving quite properly. They
Speaker 1: have a lot of I would say domestic investments that
Speaker 1: are in the overall UH indebtedness of Italy, so they
Speaker 1: are not as vulnerable as the market is very often
Speaker 1: saying I think we have to be more nuanced on
Speaker 1: on Italy. What is clear, of course, is that the
Speaker 1: new government very I would say sadly, has decided to
Speaker 1: give the worst possible messages to the market. But I
Speaker 1: am not desperate. It seems to me that the more
Speaker 1: I would say, sound and reasonable messages might come now,
Speaker 1: and I take it as important. The meeting of the
Speaker 1: Prime Minister of Italy with the President of the Commission.
Speaker 1: You've written for decades about realism it is finally here.
Speaker 1: We see it in each and every vote, and we
Speaker 1: see it in the struggles of Mr McCraw and the
Speaker 1: protests on the chance. Elise Madame mc gard once told
Speaker 1: me the protest is the art of France, that people
Speaker 1: do it there a lot. What was unusual about these
Speaker 1: recent protests and does it speak to a fragility of
Speaker 1: Mr mccrow's plans forward. Well, first of all, I think
Speaker 1: that all the advanced economy have to cope with populism.
Speaker 1: The UK, it's clear with the Brexit, the US, clear
Speaker 1: with the election of President Trump, and all continental European. Fortunately,
Speaker 1: the populism in continental Europe and in Ireland is not
Speaker 1: directed against Europe first, but against the national government first,
Speaker 1: and that is something which explains also the resilience of
Speaker 1: the European institutions and on on the aarea in the
Speaker 1: worst crisis since World War Two. As rigas France, I
Speaker 1: would say President mccon engaged in very very important reform.
Speaker 1: He was right to do so. It was really the
Speaker 1: mandate he had received from the people. Of course, that
Speaker 1: would be very very damaging for his political capital. That's
Speaker 1: unavoidable because most of the reform you have to do
Speaker 1: because they are good for the country in the medium
Speaker 1: and long run, have a cost, a political cost on
Speaker 1: the short run. So I'm not surprised. But what has happened?
Speaker 1: What what is associated with this? I would say loss
Speaker 1: of political capital, but it would it would reconquer if
Speaker 1: if I may, I'm sure that he has time this
Speaker 1: political capital. But the so called yellow jacket is something
Speaker 1: which comes out of the digital revolution, clearly, exactly like
Speaker 1: in the US, the digital revolution is the technology. It
Speaker 1: seems to me, yes, because because they are bypassing all
Speaker 1: possible organizations. John and I wanted to speak about German power,
Speaker 1: about the future of Europe, but there's also larger matters
Speaker 1: that saw Paris Saint your Man beat Liverpool and John,
Speaker 1: what was extraordinary is Olympic leon A tied Manchester City.
Speaker 1: No one expected that weekend to say football we did.
Speaker 1: Are you a huge supporter of Olympic Leon? I am
Speaker 1: not really soccer enthusiasts. You know that you can come
Speaker 1: on the show. You have not the best intellocutor, Well,
Speaker 1: I could make mistakes in judging. I was surprised myself,
Speaker 1: of course, because because Manchester City, it's Manchester City. It
Speaker 1: is yeah, I had a fantastic computations, but we will
Speaker 1: see me in any case, How does how does France
Speaker 1: compete in something as visible as football versus the capitalist
Speaker 1: juggernaut of the Premier League in England? I cannot tell
Speaker 1: you again. I'm not again a real expert in this.
Speaker 1: I love that we have the former president of the
Speaker 1: European Central Bank and you are so keen together. I
Speaker 1: figured a guy from Leon looked up to see if
Speaker 1: he was on the board of Olympico and he was
Speaker 1: busy running the Bank of France from and then in
Speaker 1: the early two thousands you had this other job to
Speaker 1: do over the e CB. Jean Corda want to wrapped
Speaker 1: things up with a delicate story, a delicate topic. And
Speaker 1: you and I have gone back and forth on this before,
Speaker 1: and you're a good sport when we talk about it.
Speaker 1: The great hikes of two thousand and eight and two
Speaker 1: thousand and eleven at the e c B, A lot
Speaker 1: of people look back and say that was a policy error.
Speaker 1: Walk me through how difficult it is to know whether
Speaker 1: you are indeed making a policy error or not, and
Speaker 1: how fine the decision actually is that you make well
Speaker 1: to do replace myself in the circumstances. I would say
Speaker 1: that what was extremely important for me was to be
Speaker 1: able in any case to engage in very bold and
Speaker 1: swift non conventional measures as well I did with my
Speaker 1: colleagues in or seven nine of August or seven, we
Speaker 1: gave a limited supply of liquidity to all our banks
Speaker 1: and they were asking for ninety five billion euros. We
Speaker 1: gave ninety five billion euros. It was very much criticized
Speaker 1: at the time, but it won me the Man of
Speaker 1: the Year of the fancial times because it was swift
Speaker 1: and bold, swift indeed because we took that decision in
Speaker 1: two hours and a half and the same it was
Speaker 1: the same when we had both. I would say the
Speaker 1: the private sector crisis coming from from Wall Street with
Speaker 1: Lemon Mothers, where we generalize the fuller lot Ma tad
Speaker 1: fix rate of liquidity, which again was very very bold
Speaker 1: because all the banks could ask for everything. At the
Speaker 1: same time, I had a mandate and as my successor
Speaker 1: and my predecessor, which was to deliver price stability, be
Speaker 1: credible in the delivery of priceability, and avoid any kind
Speaker 1: of doubts in major public opinion in Europe. And I
Speaker 1: did both if I may, I was anchoring solidly inflation
Speaker 1: expectations at times where we had a high level of inflation.
Speaker 1: I have known four pucent inflation. You know, the central
Speaker 1: bankers to the dream of that on your work you
Speaker 1: enjoyed on my watch, I had four when I left.
Speaker 1: I had in the year where I left three two
Speaker 1: point seven percent when I left, So we were in
Speaker 1: a different universe. And again I was equally anxious to
Speaker 1: deliver press stability and be credible in that delivery, including
Speaker 1: in major public opinion that very often anxious. The main
Speaker 1: the main fear of half of Europe was we are
Speaker 1: engaging in some kind of new I would say, experience
Speaker 1: never attempted in the past, and we will have inflation
Speaker 1: when you emerge the d M, the Guilder and say
Speaker 1: that the escudo and very quickly, is the bundes Bank
Speaker 1: now a different Bundesbank when you were on the watch, Yes, certainly,
Speaker 1: because now they have twenty years of experience with within
Speaker 1: the system and the open system of central banks. So
Speaker 1: this is certainly a different Bundesbank. You have also the experience,
Speaker 1: the benefit of the experience. But of course I see
Speaker 1: the Bundesbank as always keen or not losing contact with
Speaker 1: the public opinion in his own country, in her own country.
Speaker 1: That being said, the people of Germany, and I think
Speaker 1: it's paying hammage to all what has been done by
Speaker 1: the e c B is in favor of the u
Speaker 1: W at the level of of the citizens in Germany
Speaker 1: eighty percent. So it's the success of the UH is
Speaker 1: proved in a way by the support of the people.
Speaker 1: I've got a tricky question to wrap up. This is
Speaker 1: the final one. We've got a presidential race next year
Speaker 1: at the European Central Bank. Would you endorse a candidate
Speaker 1: Jean Claude. Do you like anyone right now that you
Speaker 1: think would make a good ECB presidents never coming back? No, No,
Speaker 1: I would say that it is a decision made by
Speaker 1: the heads of state and government. Have food confident that
Speaker 1: they will find out a very good president amongst a
Speaker 1: number of a potential president that are extremely good. I
Speaker 1: think we can have a Frenchman at the top. I
Speaker 1: would not exclude an thank you so much. It's great,
Speaker 1: You're always fantastic, always thoughtful. Thank you here with the
Speaker 1: terrific news flow. Donald Gimba with us. He's senior Vice
Speaker 1: President CIBC Private Wealth Market for ages at Krey with
Speaker 1: encyclopedic knowledge of Asia, among other things. I have noticed
Speaker 1: the humor recently that Australia has not had a recession
Speaker 1: since you're ute twenty five years. Would you explain why
Speaker 1: a nation is sophisticated in the is Australia has avoided
Speaker 1: the recession pain. Maybe it's neither of those things. Maybe
Speaker 1: it is. Well, first of all, it's a small population.
Speaker 1: It's six million now up from fifteen when I started going.
Speaker 1: All of Australia's the size of New York City exactly,
Speaker 1: or the size of Shanghai. You know, it's it's teeny
Speaker 1: it's natural resource based. And the and the growth in
Speaker 1: in the PRC, the People's Republic of China has has
Speaker 1: stimulated the economy. I remember being in Australia in two
Speaker 1: thousand and seven UM and they were very proud of
Speaker 1: the idea that the global economy was facing a bit
Speaker 1: of a down term, but they were insulated. And there
Speaker 1: was this joke on the news of the time that
Speaker 1: this politician had used a map of the world and
Speaker 1: actually physically moved Australia closer to China. And at the time,
Speaker 1: people were laughing about it, but actually that was actually
Speaker 1: what was happening in Australia at the time. Absolutely, and
Speaker 1: the long term at that time in two thousand and
Speaker 1: seven was that will will ride the Chinese tail for
Speaker 1: a while and then we'll jump on the Indian tail
Speaker 1: and that'll keep us going for another fifty years. Now,
Speaker 1: we'll see if that happened, and we'll see whether China
Speaker 1: can carry on as well. You've just been to Asia.
Speaker 1: What is the read on what is happening at the moment?
Speaker 1: Because I found over the last couple of weeks as
Speaker 1: we anticipate this gewin Cee, that the conversation is almost
Speaker 1: formed exclusively from the perspective of the White House. What
Speaker 1: does the White House wants? What will the President try
Speaker 1: and deliver, and not so much about the other side
Speaker 1: of the debate in this bilateral what is China willing
Speaker 1: to give up? Well that that you just hit the
Speaker 1: nail on the head, and Tom and I were talking
Speaker 1: about that briefly forty five minutes ago on TV the Properties.
Speaker 1: It's a good shows. Getting back to the point, the
Speaker 1: question in Asia and in Australia is not the US,
Speaker 1: it's China. Where are they going? What? What is the
Speaker 1: president of China's popularity? What is he accomplishing? Is the
Speaker 1: Belton Road actually working? Are coming undone? And and so
Speaker 1: as we go into this weekend, the question is what's
Speaker 1: China going to give? But remembering they need to save face. Okay,
Speaker 1: this is important. I swoket to Robert Hormat yesterday Investador
Speaker 1: Hormats with his international experience serving President Obama. We talked
Speaker 1: about Jonathan Spence the China Yale University, and everybody has
Speaker 1: to read Jonathan Spence to know China. You lived at
Speaker 1: Don Gimbal. What's the number one thing you would say
Speaker 1: to the President United States about the character of the
Speaker 1: Chinese elite. Uh, they're much more pragmatic. They're much more
Speaker 1: long term orientated. They believe very much in saving face
Speaker 1: at all costs. But they know how serious this trade
Speaker 1: thing is and they and they want to come to
Speaker 1: some agreement. And it's really not about trade and tariffs.
Speaker 1: It's much more about intellectual property in terms of the
Speaker 1: United States. And if if they if the President of
Speaker 1: the United States can understand that can understand that the
Speaker 1: Chinese want to save face, but they're willing to concede
Speaker 1: a bit on intellectual property and on on ownership in
Speaker 1: the pier in the People's Republic. Uh, and then we
Speaker 1: can get an agreement, and I personally think we will.
Speaker 1: I think the United States that has got some allies
Speaker 1: here in the likes of Germany, that we obsess over
Speaker 1: the low paid manufacturing jobs that may or may not
Speaker 1: have shifted to China. The real fear for a lot
Speaker 1: of people and within the administration, from the likes of
Speaker 1: Secretary Ross, is that the maiden Twines China program is
Speaker 1: to take the highly paid, high value added good production
Speaker 1: from the likes of the United States from the likes
Speaker 1: of Germany. And the US is not alone. The Germans
Speaker 1: are also very nervous about what the next ten years.
Speaker 1: You know, you've got a point, but I think you're
Speaker 1: running late. The an awful lot of jobs have left
Speaker 1: China and gone to Indonesia, have gone to the Philippines,
Speaker 1: have gone to my Omar because wage rates in the
Speaker 1: PRC People's Republic have actually risen. So I I think
Speaker 1: that that's kind of my point. Actually, what the Chinese
Speaker 1: do want of the high page jobs, now want the
Speaker 1: lower page jobs. Well, I suspect that then we're going
Speaker 1: to have to figure out how to have value added
Speaker 1: in this country, and the Germans are going to do
Speaker 1: have to do the same thing, because that's that's what
Speaker 1: the future of international trade is. It's where you do
Speaker 1: it best at the at the most reasonable price is
Speaker 1: going to get the business. We're gonna all gonna have
Speaker 1: to departmentalize what we do, dun, I don't know if
Speaker 1: you've ret Robert Kaplan's on Asia Cauldron going around the
Speaker 1: South China see of all these secondary nations and how
Speaker 1: they're all finding capitalism. Which of those nations interests you
Speaker 1: the most? Is the opportunity five and ten years out? Gosh,
Speaker 1: that's a great question, thank you. I would say that
Speaker 1: the Philippines, if they can straighten out their government, What
Speaker 1: does the Philippines do with Mr? They replace him at
Speaker 1: some point? I mean he's has he caved into the
Speaker 1: Chinese and the South China Sea in the last number
Speaker 1: of weeks, Yes, a little bit. Can the US respond
Speaker 1: to that? If we could get the President of the
Speaker 1: United States to close his mouth and turn off his
Speaker 1: Twitter machine, I think we'd be a lot better off.
Speaker 1: But do you think the Philippines is I think the
Speaker 1: Philippines looks good. I think that South Korea, if we
Speaker 1: can get the North Korean thing under control, looks looks interesting. Uh.
Speaker 1: Taiwan is under a cloud, always has been and probably
Speaker 1: will continue to be. But they do good good stuff. UM.
Speaker 1: Indonesia has an election coming up and it's it's not
Speaker 1: looking great to me and UH and miamrs on a
Speaker 1: part and the Malaysia. Uh, it's got a new old
Speaker 1: leader nineties plus years old. UH, and it's got a
Speaker 1: lot of potential. There you go, Don, thank you so much.
Speaker 1: Don gimball with us with the IBC, UH private well Management,
Speaker 1: with his travels through Asia and focus there in Asia,
Speaker 1: Pitt bringing our steam guest. You and him are the
Speaker 1: only two people on this island that remember when you
Speaker 1: could drive across Midtown Manhattan east to west midday and
Speaker 1: actually get somewhere. Probably although a Leon Cooperman knows a
Speaker 1: little bit more about the ins and outs of Wall
Speaker 1: Street than I do. He is, of course a hedge
Speaker 1: fund manager philanthropist. He is the chairman and the chief
Speaker 1: executive of Omega Advisors, his alma mater of his Hunter
Speaker 1: College as well as Columbia University, and he's known for
Speaker 1: starting the Goldman Sacks asset management on Leon Cooperman. Thank
Speaker 1: you very much for being with us today more you
Speaker 1: have previous least said, and I think this is great quote.
Speaker 1: All this fixation and fear about interest rates is misplaced
Speaker 1: based on what we saw in stock and bond markets yesterday.
Speaker 1: Can you explain to someone who's just landed from Mars
Speaker 1: how the market could increase the value of all these
Speaker 1: assets just because of a statement from the Federal Reserve chief. Well,
Speaker 1: if I can start off, I'd like to kind of
Speaker 1: make a recommendation, UM, and that is a suggestion. Why
Speaker 1: don't you guys have on your program a senior person
Speaker 1: from the SEC to explain why they eliminated the uptick rule,
Speaker 1: which was instituted in the mid nineteen thirties in response
Speaker 1: to the abuses, worked effectively for I think seven toy
Speaker 1: odd years, and they took it out in two thousand
Speaker 1: and eight, which gave a runway to these electronic high
Speaker 1: frequency traders ums EETRA. And why we have not dealt
Speaker 1: with the all this algorithmic stuff going on which is
Speaker 1: scaring the hell out of the pubble and creating a
Speaker 1: lot of volatility that that that that is relevant. Are
Speaker 1: you suggesting, Mr Cooperman, that we've had flashed this and
Speaker 1: flashed that and we need something more sustainable by the
Speaker 1: al goes before we get I would steer. I would say, certainly. Look,
Speaker 1: I'm old fashioned, so maybe I'm at a date I'm
Speaker 1: willing to learn. And that's why I suggested get somebody
Speaker 1: from the SEC to explain their position. I don't understand it.
Speaker 1: Everyone and I know of that there's accumulated wealth, whether
Speaker 1: it's Warren Buffett, Mary Gabelly, successful investors, Ken Lynn Gone.
Speaker 1: They buy weakness and they sell strength, and these algos,
Speaker 1: not all of them, but there's one approach where they
Speaker 1: when it's up, they want to buy it. When it's down,
Speaker 1: there to sell it. And it's exaggerates the moves, it
Speaker 1: increases volatility in the market, it scares the public and
Speaker 1: his counterproduction. Well, I'll go with the scares of public.
Speaker 1: There's no question about that. Do you mine weakness in
Speaker 1: the market right now? You know, within the purview of
Speaker 1: Leon Cooperman, Is this a point where you can acquire
Speaker 1: shares three years out, five years out? Absolutely? Well, Look,
Speaker 1: the market is the market for bonds is very homogenious.
Speaker 1: If you're dealing with triple A bonds or triple B bonds,
Speaker 1: bonds are the same. Uh, you know, rating trade with
Speaker 1: an eighth or a quarter of a point of each other.
Speaker 1: The stock market, on the other hand, is very heterogeneous.
Speaker 1: There are stocks now that are three thousand on the
Speaker 1: SMP with the index at the stocks that are with
Speaker 1: the index. And my job is to find things that
Speaker 1: are being miss priced in the market. But I didn't
Speaker 1: really respond to the first question regarding interest rates. Uh,
Speaker 1: if they're not an irrelevancy. But clearly interest rates are
Speaker 1: not at the level that represent a problem for the
Speaker 1: stock market. Every bare market and every recession I know
Speaker 1: has been preceded by high real interest rates. Okay, we
Speaker 1: have if I take the Fed funds rate and addressed
Speaker 1: for inflation zero and if you look back in two thousands,
Speaker 1: and excuse me, if you look back as early as
Speaker 1: the mid seventies bear market cycle, basically before the seventy
Speaker 1: three four downturn, the real Fed funds rate was six
Speaker 1: hundred basis points before the eighty downturn. Who was at
Speaker 1: at basis points before the ninety downturn was about six
Speaker 1: hunt basis points and so get a picture that there's
Speaker 1: high real interest rates. Real interest rates today are zero.
Speaker 1: You know, in the last fifty or sixty or ei
Speaker 1: the years, the SMP multiple has averaged fifteen times. That's
Speaker 1: not far from where you are today. However, in the
Speaker 1: last fifty years, were the SUP multiple average fifteen times,
Speaker 1: the tenure government average about six and a half percent,
Speaker 1: uh currently three percent, and they fed funds rate average
Speaker 1: close to five currently a little over two. So you know,
Speaker 1: the stock market is not you know, the stock market
Speaker 1: valuation is very attractive relative to interest rates if you
Speaker 1: believe interest rates are sustainable at these levels. I think
Speaker 1: the biggest point would make UH, and I think it's
Speaker 1: very important for people who understand. F the tenure government
Speaker 1: belonged to three percent, and I'm one of those guys,
Speaker 1: what it would be higher. Frankly, I thought it would
Speaker 1: be higher. But if the tenure government belongs to three
Speaker 1: percent and funds belong at low two percent, you don't
Speaker 1: make ten or fifteen percent a year in the stock market.
Speaker 1: You make five percent a year in the stock working
Speaker 1: and that's the track of you are this year. I
Speaker 1: think we're up four percent. Leon the heads fund business
Speaker 1: is two percent you make the fee you get or
Speaker 1: a big hunk of the piece over a hurdle rate.
Speaker 1: Is the formula broken? Is a formula dead? Well, it's
Speaker 1: a very complex question and requires a complex answer. First,
Speaker 1: the premission you have to accept is to get a
Speaker 1: premium fee, you have to deliver premium performance. Since you
Speaker 1: can't deliver premium performance, you're not gonna get a premium fee.
Speaker 1: But we've been through an unusual period. I go back
Speaker 1: to two thousand and eight. Everybody wanted for them to
Speaker 1: the economy. They wanted to blame the investment banks, to
Speaker 1: commercial banks, the rate engagencies, the broker's industry, the government.
Speaker 1: Nobody wanted to blame the individual for the conduct of
Speaker 1: the financial affairs, saying that they had no responsibility to
Speaker 1: figure out what they could afford and what they can afford. Similarly,
Speaker 1: if in two thousand and nine, I've said to you,
Speaker 1: and we came as close to saying that as anybody.
Speaker 1: Steve Irono and my partner who coordinates love about macro
Speaker 1: research work. We were very bullish in two thousand and nine.
Speaker 1: But if I said to you, you don't want to
Speaker 1: be in an absolute return manager. You want to have
Speaker 1: your money with a relative return manager. So a hedge
Speaker 1: fund is not a good place to have your money
Speaker 1: because we're gonna have a ten year straight up bullmark.
Speaker 1: In a ten year straight up economy, you would have
Speaker 1: had me arrested for being somewhat demented. Okay, And that's
Speaker 1: what's happened. And so the individual that made a decision
Speaker 1: in two thousand nine and they wanted to be in
Speaker 1: a hedge fund, they were not. And they were in
Speaker 1: a vehicle that was designed to be absolute return oriented,
Speaker 1: that was not gonna be fully invested, was going to
Speaker 1: carry a short book, and having a short book is
Speaker 1: a hedge against prospecty in a one way bull market.
Speaker 1: So now the question becomes today at twenty wherever we
Speaker 1: are in the SMP, whatever the number is, you know,
Speaker 1: nine years into a bull cycle, do you want to
Speaker 1: be in a long only um product. So you know,
Speaker 1: I don't complain. I don't complain. It's like Henry Ford
Speaker 1: when have got cooked, you know, driving on a highway
Speaker 1: with a young chick. Uh. He said, you know, don't complain,
Speaker 1: don't explain. You know, you have to live in the
Speaker 1: world we're in. And I say that if we continue
Speaker 1: in a straight up bull market, which I doubt. Basically,
Speaker 1: you want to be in a long only strategy and
Speaker 1: you don't want to be in an absolute return strategy.
Speaker 1: So you know, but the hedge fund model is unequivocally
Speaker 1: being challenged. People are tired of paying a premium fee
Speaker 1: to leg some in this and until that changes, the
Speaker 1: industry is gonna be in the defensive mode, which had
Speaker 1: nothing to do with my decision to retire. To be
Speaker 1: honest with you, you know, my decision was totally based
Speaker 1: on seventy five years old. I've been doing this over
Speaker 1: fifty years. I'm giving my money away to charity, and
Speaker 1: basically it's there were two things I said to my investors.
Speaker 1: I wrote him a letter. I said that basically, statistically,
Speaker 1: if you make it a past sixty five and cancered
Speaker 1: US and get you on average, you make it to
Speaker 1: eighty five. I hope to be better than average. But
Speaker 1: if I'm just average, I got ten years left. Since
Speaker 1: I turned seventy five six weeks ago, I said, I
Speaker 1: don't want to spend the last ten years of my life.
Speaker 1: Let's go to the statistical marvel. Well, Leon Cooperman, I
Speaker 1: want to ask you if you have a green thumb
Speaker 1: have I have? That whole thing is built so out
Speaker 1: of proportion, it's not even funny. What is going on
Speaker 1: with that whole cannabis industry? And tell us your perspectively,
Speaker 1: and you're you're you're asking the wrong guy. I am
Speaker 1: very friendly with the generalman John Coffler, who I have
Speaker 1: known for forty years, a real gentleman. He calls me up,
Speaker 1: he tells me your son a starting a cannabis company.
Speaker 1: He'd like to meet me. I meet with Ben Kabla,
Speaker 1: very impressed, very fine young man, very impressed. I put
Speaker 1: a very small sum of money in. They have a
Speaker 1: conference call, okay, And I asked a question on the
Speaker 1: conference call. The next thing, I know the New York
Speaker 1: Post as my picture in it, as a cannabis kid,
Speaker 1: as a cannabis king. You know, it's obviously an explosive industry,
Speaker 1: but there's gonna be a lot of money that area.
Speaker 1: Let me explain. Let me answer the question before you
Speaker 1: go on. Because of that picture in the post. Okay,
Speaker 1: every new issue in this area calls me up and
Speaker 1: wants to come and visit me. And some thirty five
Speaker 1: year old kids sits in my office and explains to
Speaker 1: me his vision. And if what he tells me is
Speaker 1: accurate on paper, he's worth a half a billion to
Speaker 1: a billion dollars. I know that that doesn't make any sense.
Speaker 1: There's gonna be enormous shakeout. Yes, the industry is going
Speaker 1: to grow, the nation is going to get high and
Speaker 1: this stuff. But you know, you have to figure out
Speaker 1: who the winners and losers are. It will be very,
Speaker 1: very careful. If I was the public and we got
Speaker 1: one minute it left. Have you ever had a public
Speaker 1: relations team? Has there ever been a group that's had
Speaker 1: to control you and get you on message? I'm on message.
Speaker 1: Just ask me a questions. I'll give you a question. Yeah,
Speaker 1: I'll give you I'm totally What do you do right now?
Speaker 1: I want you to know what to do with Apple computer?
Speaker 1: Right now? Apple's imploded, the world's over, Tim Cook's of failure.
Speaker 1: What do you do with Apple? Come on, I have
Speaker 1: my money and Google, I have my money. You know
Speaker 1: I know a lot about what I own. I don't
Speaker 1: know a lot about it. I don't know. You're long Google,
Speaker 1: tell us give us the belief story on Google quickly?
Speaker 1: You know the market sells the fifteen times earnings. Google's
Speaker 1: the twenty times the market is going to grow six percent.
Speaker 1: Google's gonna go to sitting on a fortress balance sheet,
Speaker 1: highly diversified business. It's cheap relative to its growth. You
Speaker 1: look in two thousands, Cisco is a hundred times earnings.
Speaker 1: You know, we're a totally different worlds. Okay, So you
Speaker 1: know I find plenty of things to do and I'm
Speaker 1: on message. You don't need a pr gout to control me.
Speaker 1: I respond to your questions. You asked me a question.
Speaker 1: I believe that's what we got. Leon Cooperman, thank you
Speaker 1: so much with my advisors and thrilled these with us.
Speaker 1: And we're not absolutely thrilled to bring in a mayor
Speaker 1: of a great accomplishment. He is a mayor of a
Speaker 1: small city on the West coast, Los Angeles. We said
Speaker 1: good morning to everyone at Sirius Sex him listening in
Speaker 1: Los Angeles. And before we dive into all the usual
Speaker 1: questions and the rest of it, I just want you
Speaker 1: to parse what it's like when you first nail Oscar
Speaker 1: Peterson and B flat. There's there's something on the piano.
Speaker 1: Oscar Peterson and B flat is an act of God,
Speaker 1: isn't it? It is an act of God, for sure,
Speaker 1: the finest who ever played the piano. And I have
Speaker 1: a piano in my office and I can only hope
Speaker 1: to play a fraction as well of Oscar Peterson did.
Speaker 1: This is a great idea. I could play my fracture
Speaker 1: lousy Garcetti imitation piano here and let's do it. I
Speaker 1: think that we can find if we had a piano
Speaker 1: right now, we could do it from Washington. While we're talking,
Speaker 1: you know, Pim, please tell us a little bit about
Speaker 1: what tune you believe the Democrats should play when they
Speaker 1: enter the majority in the House in January. What tune
Speaker 1: should they play? Uh? I don't know. I think that
Speaker 1: probably sisters are doing it for themselves. Something where we're
Speaker 1: finally stepping up and actually taking agency back and standing
Speaker 1: up for a culture not of corruption and cruelty, but
Speaker 1: hopefully of action and getting stuff done for the American people.
Speaker 1: That's where I live as a mayor, and I'm excited
Speaker 1: to see Congress. I met yesterday with Chairman de Fasio,
Speaker 1: who heads up transportation and infrastructure, and I'm hopeful we'll
Speaker 1: actually start fixing this country and that I hope this
Speaker 1: Congress focuses on that first. When you talk about fixing
Speaker 1: the country, you're talking about infrastructure spending. Absolutely. UM. I
Speaker 1: started a group called Accelerator for America with fellow mayors
Speaker 1: that we founded bring together folks from industry and labor
Speaker 1: and nonprofit world to kind of say, well, Washington, sleep,
Speaker 1: We're gonna kind of take America's destiny ourselves and move
Speaker 1: forward infrastructure and good jobs and opportunity zones. And we
Speaker 1: just met in Philadelphia. We had a poll of a
Speaker 1: thousand voters that we're going to be releasing this week
Speaker 1: and UM, after healthcare and jobs, number three was infrastructure
Speaker 1: and having campaigned for people around the country over the
Speaker 1: last few months, from Mississippi to Oklahoma to California, everywhere.
Speaker 1: Obviously the Midwest, people want the roads paved, they want
Speaker 1: the bridges repaired, they want jobs, and they want, you know,
Speaker 1: infrastructure to be world class again. Am study of Los
Speaker 1: Angeles with this folks coast to coast. David Wasserman over
Speaker 1: at Cook Political Report just did a stunning summary of
Speaker 1: what the House Democrats will represent in the new Congress.
Speaker 1: Sevent of all Asian, of all Latinos, sixty of all
Speaker 1: African Americans sixty of all college grads, and on and
Speaker 1: on and on, and it's a great trend led by
Speaker 1: your Los Angeles of a more demographically diverse America. I
Speaker 1: want you to speak to the tent and Republicans left
Speaker 1: in your state. How do they adapt and adjust to
Speaker 1: the new America that's been led by the diversity of California. Well,
Speaker 1: I'm not going to give advice to the party, but
Speaker 1: you know, I have of my city is registered as Republicans.
Speaker 1: That's a million people, and I would just say, you know,
Speaker 1: I work for you to um. You know, we raised
Speaker 1: the minimum wage together because a majority of Republicans do
Speaker 1: believe in that, contrary to the Republican leadership here in
Speaker 1: Washington d c Um. We also lowered the city's business tax,
Speaker 1: the traditionally kind of Republican idea. But Democrats are behind
Speaker 1: that too because they want to see small businesses start
Speaker 1: up and be prosperous in my city. It's I would
Speaker 1: just tell them put down your party affiliations. You know,
Speaker 1: if you need to duke get out election time, fine,
Speaker 1: but let's figure out a pathway forward of the things
Speaker 1: that unite us. UM. You know, we made community college
Speaker 1: free in l A. And more kids went to college
Speaker 1: the next year in our community college system from our
Speaker 1: public school. And so I think Republicans care about that stuff.
Speaker 1: And if they want to be a party of extremism,
Speaker 1: they can turn into a permanent boutique party in California.
Speaker 1: But if they want to get together with us, we're
Speaker 1: more than happy to work together. Um, you know, between
Speaker 1: elections for sure. And I think if they want any
Speaker 1: sense of ever being back in power, they've got to
Speaker 1: listen to Americans, and they've got to listen to the future,
Speaker 1: which is very much embodied in Los Angeles and California.
Speaker 1: America saidy, could you speak to the issue of natural
Speaker 1: disasters that afflict not only California but many other places
Speaker 1: around the world and are accentuated by the effects of
Speaker 1: climate change, and what you believe should be done in
Speaker 1: order to preserve the current infrastructure that exists. Well, well,
Speaker 1: mayors are the political first responders to these events. Um,
Speaker 1: you can't tell Sylvester Turner in Houston that climate change
Speaker 1: isn't real? Still real rebuilding from Harvey. Um, you know
Speaker 1: local officials in the Florida Panhandle and most you know,
Speaker 1: notably us in California over the last couple of weeks,
Speaker 1: with the heroic work of our firefighters and others who
Speaker 1: responded to these fires. I loved what Jerry Brown said.
Speaker 1: He said, this is the new abnormal, and I think
Speaker 1: it's it's real. It's one of the reasons, with help
Speaker 1: from Mike Bloomberg and others, I serve on the C forty,
Speaker 1: the Global Organization of Mayors confirmed Climate Change and founded
Speaker 1: Climate Mayors, which is the American group. Now that I've
Speaker 1: built a four D and ten cities that have said, hey,
Speaker 1: if this White House is at we're in and we're
Speaker 1: going to implement Paris where we live, you are at
Speaker 1: the absolute nexus of copyright and intellectual property in this nation.
Speaker 1: I mean that is the perception of your Hollywood, your
Speaker 1: Los Angeles. What's your advice to President Trump to actually
Speaker 1: get fixed what everyone agrees is a major issue with China.
Speaker 1: You know, I think he's saying the right things. I
Speaker 1: just don't see much of a strategy. Um. I think
Speaker 1: that it's more about the fireworks of tariffs, which have
Speaker 1: a huge impact. Those are taxes on us, and you know,
Speaker 1: whether it's stock workers in l A or whether it's
Speaker 1: construction workers that are slowing down projects because of soaring
Speaker 1: steel costs. We have to have a strategy. So I
Speaker 1: think we act tough. But you know, I've told that
Speaker 1: directly to Chinese officials. I've said, look, that's absolutely crazy
Speaker 1: that you have a quota on movies from Hollywood. Right now,
Speaker 1: I said, aren't you a strong country? Now? I think
Speaker 1: we have to make that argument. You've grown up. You
Speaker 1: are a powerful nation. If we're going to be a
Speaker 1: relationship of equals, we have to be treated as equals.
Speaker 1: And it's a great place to start. Twenty seconds America study.
Speaker 1: How many times have you seen a star is born?
Speaker 1: Which one there? That's the l A answer with Mr
Speaker 1: Cooper and I haven't seen. I've been too busy working
Speaker 1: for the people of l A and changed in the
Speaker 1: house out. But I saw the Barber Streissan one. I
Speaker 1: haven't seen the two earlier ones, so I'd say one
Speaker 1: time between the four. But I'm looking forward to Cooper
Speaker 1: very good. I'm sure you will. America Study of Lesie Angles.
Speaker 1: Thank you so much. Thanks for listening to the Bloomberg
Speaker 1: Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud,
Speaker 1: or whichever podcast platform you prefer. I'm on Twitter at
Speaker 1: Tom Keene before the podcast. You can always catch us worldwide.
Speaker 1: I'm Bloomberg Radio